Kuwait's National Petroleum Company (KNPC) plans to sign on Tuesday the main contracts with the companies selected to build the Al-Zour oil refinery.

Construction of the 615,000-barrel-per-day refinery, which would be the largest in the Middle East, could be a major boost to Kuwait's economy, which has slowed due to political tensions and low oil prices.

"This is an important milestone," CEO of KNPC Mohammed Al-Mutairi told Reuters.

Al-Mutairi said commissioning of the refinery was expected to start in November 2019. The project cost is about KD4.8 billion ($15.9 billion), he said, adding that KNPC would not seek any external financing.

Commissioning for Kuwait's Clean Fuel Project is expected to start in April 2018, he said. That project is to upgrade and expand two of Kuwait's largest refineries to focus on producing higher-value products for export, such as diesel and kerosene.

"We are in the final stages for talking with the government corporate financing, the total project cost is around 4 billion dinars," he said.

Al-Mutairi said the company would look to finance 70 per cent of the project externally and the other 30 per cent would be funded internally through the Kuwait Petroleum Corporation.

Sources had said in April that KNPC was in talks with banks to raise a loan worth around $10 billion for the project.

A tender to build a permanent liquefied natural gas (LNG) import terminal will close in November, with the awarding of contracts for the project expected by early 2016, Al-Mutairi said.

The cost of the 3-billion-cu-ft-per-day terminal is about KD900 million ($2.98 billion). - Reuters